Atmus Filtration Technologies Reports First Quarter 2025 Results
NASHVILLE, Tenn.--(BUSINESS WIRE)--May 02, 2025--
Atmus Filtration Technologies Inc. (Atmus; NYSE: ATMU), a global leader in filtration and media solutions, today reported financial results for its first quarter that ended March 31, 2025.
First Quarter Highlights
-- Net sales of $417 million -- GAAP net income of $45 million -- Diluted earnings per share of $0.54 -- Adjusted earnings per share of $0.63 -- Adjusted EBITDA of $82 million and Adjusted EBITDA margin of 19.6% -- Cash provided by operating activities was $29 million -- Adjusted free cash flow was $20 million
2025 Outlook
The company is reaffirming guidance for year 2025 as follows:
-- Revenue to be in the range of $1,670 million to $1,735 million -- Adjusted EBITDA margin to be in the range of 19.0% to 20.0% -- Adjusted earnings per share in the range of $2.35 to $2.60
During the quarter, Atmus repurchased $10 million of common stock under the $150 million share repurchase program authorized by the Board of Directors in July 2024. As of March 31, 2025, $120 million was remaining under the authorization. Additionally, Atmus paid a quarterly cash dividend of $0.05 per share of common stock.
"The Atmus team delivered a solid quarter of financial results to start 2025, despite challenging market conditions, by providing comprehensive filtration solutions for our customers," said Steph Disher, Chief Executive Officer of Atmus. "We are focused on the things we can control to deliver our growth strategy. Our resilient aftermarket-focused business combined with disciplined execution will continue to drive long-term shareholder value."
First Quarter Results
For the first quarter of 2025, Atmus posted net sales of $417 million, compared to $427 million in the first quarter of 2024, a decrease of 2.4%. The decrease in sales was primarily due to the unfavorable impacts of currency and lower volumes, partially offset by increases in pricing.
Gross margin was $111 million, compared to $112 million in the first quarter of 2024. Gross margin as a percent of net sales was 26.5% compared to 26.2% in the same period last year. The decrease in Gross margin was primarily due to the unfavorable impact of currency, higher one-time costs associated with the separation of our business from Cummins Inc., higher logistics costs and lower volumes, partially offset by favorable pricing, manufacturing and warranty costs.
Adjusted EBITDA was $82 million, compared to $80 million in the first quarter of 2024. Adjusted EBITDA margin was 19.6% compared to 18.8% in the same period last year. Adjusted EBITDA in the first quarter excludes $9 million of one-time costs associated with the separation of our business from Cummins compared to the prior year quarter which excludes $6 million of one-time costs.
Net income was $45 million, or $0.54 of diluted earnings per share in the first quarter of 2025, compared to $46 million, or $0.54 of diluted earnings per share in the same period last year.
Adjusted earnings per share was $0.63 in the first quarter of 2025, compared to $0.60 of Adjusted earnings per share in the same period last year.
The effective tax rate for the first quarter was 21.3%.
Cash provided by operating activities was $29 million in the first quarter of 2025, compared to cash used in operating activities of $8 million in the first quarter of 2024.
Adjusted free cash flow was $20 million in the first quarter of 2025, compared to $(13) million in the first quarter of 2024. Adjusted free cash flow in the first quarter of 2025 excludes $4 million of one-time capital expenditures associated with our separation from Cummins compared to $3 million in the prior year. Additionally, Adjusted free cash flow in the first quarter of 2024 excludes $3 million of other one-time separation expenditures primarily comprised of working capital inefficiencies associated with the move from intercompany settlement terms with Cummins to standalone practices.
First Quarter 2025 Conference Call and Webcast
Atmus will host a conference call and webcast to discuss the company's first quarter 2025 results on Friday, May 2, 2025, at 10:00 a.m. CT.
A live webcast and replay of the conference call can be accessed from the Atmus investor relations website at http://investors.atmus.com.
About Atmus Filtration Technologies Inc.
Atmus Filtration Technologies Inc. is a global leader in filtration and media solutions. For more than 65 years, the company has combined its culture of innovation with a rich history of designing and manufacturing filtration solutions. With a presence on six continents, Atmus serves customers across truck, bus, agriculture, construction, mining, marine and power generation vehicle and equipment markets, along with providing comprehensive aftermarket support and solutions. Headquartered in Nashville, Tennessee (U.S.), Atmus employs approximately 4,500 people globally who are committed to creating a better future by protecting what is important. Learn more at https://www.atmus.com.
Forward-looking disclosure statement
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995, including, without limitation, those that are based on current expectations, estimates and projections about the industries in which we operate and management's views, plans, objectives, projections, beliefs and assumptions. Forward-looking statements may be identified by the use of words such as "anticipates," "expects," "forecasts," "intends," "plans," "believes," "seeks," "estimates," "could," "should," "may" or words of similar meaning. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding the outlook for our future business and financial performance, discussions of future operations, our strategy for growth and market position. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. If the underlying assumptions prove inaccurate, or known or unknown risks or uncertainties materialize, our actual outcomes, results and financial condition may differ materially from what is expressed, implied or forecasted in such forward-looking statements. Risks and uncertainties include, but are not limited to, those reflected in Part I, Item 1A, "Risk Factors," and elsewhere in our Annual Report on Form 10-K for our fiscal year ended December 31, 2024, in our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2025, and also as may be described from time to time in future reports we file with the Securities and Exchange Commission. You are cautioned not to place undue reliance on forward-looking statements. The forward-looking statements made herein are made only as of the date hereof and we undertake no obligation to publicly update or to revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.
Non-GAAP measures
We use non-GAAP financial information and believe it is useful to investors as it provides additional information to facilitate comparisons of historical operating results, identify trends in our underlying operating results and provide additional insight and transparency on how we evaluate our business. We use non-GAAP financial measures to budget, make operating and strategic decisions and evaluate our performance. We have detailed the non-GAAP adjustments that we make in our non-GAAP definitions below. We believe the non-GAAP measures should always be considered along with the related U.S. GAAP financial measures. We have provided the reconciliations between the U.S. GAAP and non-GAAP financial measures and we also discuss our underlying U.S. GAAP results throughout our Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K.
Our primary non-GAAP financial measures are listed below and reflect how we evaluate our current and prior-year operating results. As new events or circumstances arise, these definitions could change. When our definitions change, we provide the updated definitions and present the related non-GAAP historical results on a comparable basis.
-- "EBITDA" is defined as earnings or losses before interest expense, income
taxes, depreciation and amortization and "EBITDA margin" is defined as
EBITDA as a percent of net sales. We believe EBITDA and EBITDA margin are
useful measures of our operating performance as they assist investors and
debt holders in comparing our performance on a consistent basis without
regard to financing methods, capital structure, income taxes or
depreciation and amortization methods, which can vary significantly
depending upon many factors. Additionally, we believe these metrics are
widely used by investors, securities analysts, ratings agencies and
others in our industry in evaluating performance.
-- "Adjusted EBITDA" is defined as EBITDA after adding back certain one-time
expenses, reflected in cost of sales and selling, general and
administrative expenses, associated with becoming a standalone public
company and "Adjusted EBITDA margin" is defined as Adjusted EBITDA as a
percent of net sales. We believe Adjusted EBITDA and Adjusted EBITDA
margin are useful measures of our operating performance as it allows
investors and debt holders to compare our performance on a consistent
basis without regard to one-time costs attributable to our becoming a
standalone public company.
-- "Adjusted earnings per share" is defined as diluted earnings per share
(the most comparable U.S. GAAP financial measure) after adding back
certain one-time expenses, reflected in cost of sales and selling,
general and administrative expenses, associated with becoming a
standalone public company less the related tax impact of the same
one-time expenses. We believe Adjusted earnings per share provides
improved comparability of underlying operating results.
-- "Free cash flow" is defined as cash flows provided by (used for)
operating activities less capital expenditures and "Adjusted free cash
flow" is defined as Free cash flow after adding back certain one-time
capital expenditures and other separation related costs associated with
becoming a standalone public company. We believe Free cash flow and
Adjusted free cash flow are useful metrics used by management and
investors to analyze our ability to service and repay debt and return
value to shareholders.
The metrics defined above are not in accordance with, or alternatives for, U.S. GAAP financial measures and may not be consistent with measures used by other companies. It should be considered supplemental data; however, the amounts included in the EBITDA, EBITDA margin, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted earnings per share, Free cash flow and Adjusted free cash flow calculations are derived from amounts included in the consolidated statements of net income and cash flows.
We do not consider our non-GAAP financial measures as superior to, or a substitute for, the equivalent measures calculated and presented in accordance with GAAP. Some of the limitations are: such measures do not reflect our cash expenditures, or future requirements for capital expenditures or contractual commitments; such measures do not reflect changes in, or cash requirements for, our working capital needs; such measures do not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our debt; although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and such measures do not reflect any cash requirements for such replacements; and other companies in our industry may calculate such measures differently than we do, limiting their usefulness as comparative measures. To properly and prudently evaluate our business, we encourage you to review the unaudited condensed consolidated financial statements included in our SEC filings and not rely on a single financial measure to evaluate our business.
ATMUS FILTRATION TECHNOLOGIES INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF NET INCOME
(in millions of U.S. dollars, except per share data)
(Unaudited)
For the Three Months Ended
March 31,
-----------------------------------
2025 2024
------------------- --------------
NET SALES(a) $ 416.5 $ 426.6
Cost of sales 306.0 314.8
--- ---------- ----------
GROSS MARGIN 110.5 111.8
OPERATING EXPENSES AND INCOME
Selling, general and administrative
expenses 45.9 43.3
Research, development and
engineering expenses 9.1 10.1
Equity, royalty and interest income
from investees 9.2 10.4
Other operating (income) expense,
net (0.2) 0.2
--- ---------- ----------
OPERATING INCOME 64.9 68.6
Interest expense 8.4 10.5
Other income, net 0.3 0.2
--- ---------- ----------
INCOME BEFORE INCOME TAXES 56.8 58.3
Income tax expense 12.1 12.8
--- ---------- ----------
NET INCOME $ 44.7 $ 45.5
=== ========== ==========
PER SHARE DATA:
Weighted-average shares for basic EPS 82.8 83.3
Weighted-average shares for diluted EPS 83.2 83.6
Basic earnings per share $ 0.54 $ 0.55
=== ========== ==========
Diluted earnings per share $ 0.54 $ 0.54
=== ========== ==========
(a) Includes sales to related parties of $14 million and $82 million for
the three months ended March 31, 2025 and 2024, respectively.
ATMUS FILTRATION TECHNOLOGIES INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions of U.S. dollars, except share data)
(Unaudited)
March 31, December 31,
2025 2024
------------ -----------------
ASSETS
Cash and cash equivalents $ 183.3 $ 184.3
Accounts and notes receivable, net 282.4 254.2
Inventories 270.8 266.6
Prepaid expenses and other current
assets 46.9 49.9
------- ----------
Total current assets 783.4 755.0
Property, plant and equipment, net 192.3 186.2
Investments and advances related to
equity method investees 86.9 84.9
Goodwill 84.7 84.7
Other assets 80.8 79.5
------- ----------
TOTAL ASSETS $ 1,228.1 $ 1,190.3
======= ==========
LIABILITIES
Accounts payable $ 217.8 $ 193.1
Accrued compensation, benefits and
retirement costs 23.9 37.2
Current portion of accrued product
warranty 5.0 4.9
Current maturities of long-term debt 26.3 22.5
Other accrued expenses 78.8 87.2
------- ----------
Total current liabilities 351.8 344.9
------- ----------
Long-term debt 562.5 570.0
Accrued product warranty 7.4 7.3
Other liabilities 41.1 40.7
------- ----------
TOTAL LIABILITIES 962.8 962.9
Commitments and contingencies (Note 10)
EQUITY
Common stock, $0.0001 par value
(2,000,000,000 shares authorized,
83,457,896 and 83,403,813 shares
issued at March 31, 2025 and December
31, 2024, respectively) -- --
Additional paid-in capital 64.2 61.9
Retained earnings 305.1 264.5
Accumulated other comprehensive loss (74.0) (79.0)
Treasury stock, at cost (793,971
shares at March 31, 2025 and 537,643
shares at December 31, 2024) (30.0) (20.0)
------- ----------
TOTAL EQUITY 265.3 227.4
------- ----------
TOTAL LIABILITIES AND EQUITY $ 1,228.1 $ 1,190.3
======= ==========
ATMUS FILTRATION TECHNOLOGIES INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions of U.S. dollars)
(Unaudited)
For the Three Months Ended March 31,
----------------------------------------------
2025 2024
--- ------------- --- --- ------------
CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES
Net income $ 44.7 $ 45.5
Adjustments to
reconcile net income
to operating cash
flows:
Depreciation and
amortization 7.2 5.4
Deferred income
taxes (0.1) 0.1
Equity in income of
investees, net of
dividends (1.9) 0.8
Share-based
compensation 2.3 2.0
Foreign currency
remeasurement and
transaction
exposure (0.5) 1.1
Changes in current
assets and
liabilities:
Trade and other
receivables (24.9) (18.2)
Inventories (1.1) (9.6)
Prepaid expenses
and other
current assets 3.4 (3.2)
Accounts payable 22.5 0.3
Other accrued
expenses (22.0) (28.4)
Changes in other
liabilities 0.2 3.3
Other, net (1.1) (7.3)
--- ------------- --- ------------
Net cash
provided by
(used in)
operating
activities 28.7 (8.2)
--- ------------- --- --- ------------
CASH USED IN INVESTING
ACTIVITIES
Capital
expenditures (12.4) (10.6)
--- ------------- --- ------------
Net cash used
in investing
activities (12.4) (10.6)
--- ------------- --- ------------
CASH USED IN FINANCING
ACTIVITIES
Payments on long-term
debt (3.8) --
Repurchases of Common
stock (10.0) --
Dividends paid (4.1) --
--- ------------- --- ------------
Net cash used
in financing
activities (17.9) --
--- ------------- --- ------------
Effect of exchange rate
changes on cash and cash
equivalents 0.6 --
--- ------------- --- --- ------------
Net increase in cash and
cash equivalents (1.0) (18.8)
Cash and cash equivalents
at beginning of period 184.3 168.0
--- ------------- --- --- ------------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 183.3 $ 149.2
=== ============= === === ============
ATMUS FILTRATION TECHNOLOGIES INC. AND SUBSIDIARIES
EARNINGS PER SHARE - RECONCILIATION
(in millions of U.S. dollars, except per share data)
(Unaudited)
For the Three months ended March 31,
------------------------------------------
2025 2024
Net income $ 44.7 $ 45.5
---- --------------- --- --------------
Weighted-average shares for
basic EPS 82.8 83.3
Plus incremental shares from
assumed conversions of
long-term incentive plan
shares 0.4 0.3
---- --------------- --- --------------
Weighted-average shares for
diluted EPS 83.2 83.6
==== =============== === ==============
Basic earnings per share $ 0.54 $ 0.55
==== =============== === ==============
Diluted earnings per share $ 0.54 $ 0.54
==== =============== === ==============
ATMUS FILTRATION TECHNOLOGIES INC. AND SUBSIDIARIES
NET INCOME TO EBITDA AND ADJUSTED EBITDA - RECONCILIATION
(in millions of U.S. dollars)
(Unaudited)
For the Three Months Ended
March 31,
----------------------------------
2025 2024
NET INCOME $ 44.7 $ 45.5
Plus:
Interest expense 8.4 10.5
Income tax expense 12.1 12.8
Depreciation and amortization 7.2 5.4
--- --------- --- --------
EBITDA (non-GAAP) $ 72.4 $ 74.2
=== ========= === ========
Plus:
One-time separation costs(a) 9.3 6.0
--- --------- --- --------
Adjusted EBITDA (non-GAAP) $ 81.7 $ 80.2
=== ========= === ========
Net sales $ 416.5 $ 426.6
Net income margin 10.7% 10.7%
EBITDA margin (non-GAAP) 17.4% 17.4%
Adjusted EBITDA margin (non-GAAP) 19.6% 18.8%
(a) Primarily comprised of one-time expenses related to Information
Technology, warehousing, manufacturing and Human Resources separation
costs.
ATMUS FILTRATION TECHNOLOGIES INC. AND SUBSIDIARIES
DILUTED EARNINGS PER SHARE TO ADJUSTED EARNINGS PER SHARE - RECONCILIATION
(per share)
(Unaudited)
For the Three Months Ended
March 31,
--------------------------------
2025 2024
Diluted earnings per share $ 0.54 $ 0.54
Plus:
One-time separation costs(a) 0.11 0.07
Less:
Tax impact of one-time separation
costs(a) 0.02 0.01
---- ---------- ----------
Adjusted earnings per share $ 0.63 $ 0.60
==== ========== ==========
(a) Primarily comprised of one-time expenses related to Information
Technology, warehousing, manufacturing and Human Resources separation
costs and the related tax impact of those expenses. The tax impact of
one-time separation costs for the three months ended March 31, 2025 and
2024 were $2.0 million and $1.3 million, respectively.
ATMUS FILTRATION TECHNOLOGIES INC. AND SUBSIDIARIES
CASH FLOWS FROM OPERATING ACTIVITIES TO FREE CASH FLOW AND
ADJUSTED FREE CASH FLOW - RECONCILIATION
(in millions of U.S. dollars)
(Unaudited)
For the Three Months Ended
March 31,
----------------------------------
2025 2024
Cash provided by (used in) operating
activities $ 28.7 $ (8.2)
Less:
Capital expenditures $ 12.4 $ 10.6
--- --------- ----------
Free cash flow (non-GAAP) $ 16.3 $ (18.8)
=== ========= ==========
Plus:
One-time separation capital
expenditures 3.5 2.8
Other one-time separation related(a) -- 3.3
--- --------- ----------
Adjusted free cash flow (non-GAAP) $ 19.8 $ (12.7)
=== ========= ==========
(a) Primarily comprised of one-time working capital inefficiencies
associated with the move from intercompany settlement terms with
Cummins to standalone practices.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250501636877/en/
CONTACT:
Media Contacts
Investor relations:
Todd Chirillo
investor.relations@atmus.com
Media relations:
Keri Moenssen
media.inquiries@atmus.com
(END) Dow Jones Newswires
May 02, 2025 06:45 ET (10:45 GMT)
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